Small business insurance comes in several forms, with many factors to be considered every time. A lot of business owners struggle to find coverage that caters to their operations' particular needs. Given all the insurance myths that complicate the process, it's no surprise. Common questions that arise can include:
What should be part of the coverage?
Is a single comprehensive insurance policy enough for business owners, or do they need more?
Are brokers necessary when small business insurance is being purchased?
It's very important to have key protection against any possible claims. Part of that is having a clear view of the truth behind some of the most common myths, such as:
Myth #1: General Liability Covers All Possible Risks
Business owners sometimes believe that general liability is the solution to protecting their business from every risk that may come up. However, general liability only covers certain claims, and it may not prevent other claims from arising.
Business owners with general liability insurance are protected against instances when someone gets injured while visiting their facilities, when there's an accident that occurs within the operations, or when there are damages to property. These owners are also held accountable if someone's reputation gets damaged.
Myth #2: Home-Based Businesses Are Protected by Home Insurance
People are under the impression that having home insurance will be enough for home-based small businesses to be protected. However, as the name implies, the policy actually just applies to the home.
While a little coverage can be had and certain add-ons can be availed of by business owners, buying proper business insurance would still be better. That way, the home business' particular needs will be met for business operations to be protected.
Myth #3: Workers' Compensation Insurance Isn't Necessary If There Aren’t Any Employees
Many business owners think that they do not need workers' compensation insurance because they are the only employees of the business. However, the location of the business can affect this decision. While some states require them to carry this form of insurance, it isn't required in others. In any case, even sole proprietors may need to have this type of insurance.
Context is everything; if the workers are contractual, for example, business owners will need workers' compensation insurance. This becomes a requirement for business owners when employees are involved in either the part-time and/or full-time capacity.
Myth #4: Any Damages from Flooding Will Be Covered by Existing Insurance
The insurance usually assumes the business will be affected by water damage stemming from a broken pipe or a neighbourhood problem with sewage but does not cover flood damage. It's important to get this as an add-on to the existing business insurance so that flooding damage would be part of the coverage.
For operations in an area with high risk in terms of flooding, getting comprehensive coverage that includes commercial flood insurance is key.
Business insurance is crucial for all endeavours, even small businesses. To make informed decisions, it's necessary to get to the bottom of popular myths. Myths include existing insurance covering flood damage and general liability covering all possible risks.
Looking to get business insurance on the Gold Coast? Drop New Wave Insurance a line today! We aim to help our clients find the right insurance that can protect them alongside minimising risk exposure.